The May 2021 meeting of the ABA Tax Section, traditionally held in a group live format in Washington, D.C. but presented virtually this year, is always good for a few announcements about topics of relevance. This year was no exception; here are two items of interest to flow-through tax professionals.
While flow-through taxation still is generally the way to go for the closely held business, it is not uncommon for a partnership to incorporate with a view of engaging in an exit transaction after five years via a stock sale that qualifies for the 100% exclusion of gain provided by §1202. Here is a nuance of this Code that came up in our practice.
A follow-up regarding PLR 202114002 (the favorable §1202 ruling involving an insurance agent/broker), courtesy of Eide Bailly.
PLR 202114002 is a taxpayer-liberal PLR, which provides that a business referred to as an “insurance agent or broker” was a qualified trade or business for §1202 purposes.
How is an S corporation’s accumulated adjustment account (“AAA”) impacted by forgiven PPP loan proceeds? The answer is not as easy as it first may seem.
Chuck and Michael opine on Warne v. Commissioner, TC Memo 2021-17, a case that addressed, among other issues, an estate tax charitable deduction.